Oil down with China growth expectations

OPEC likely to hold output at current 30 million barrels a day

KateGibson

NEW YORK (MarketWatch) — Oil declined on Monday for a fifth day after China indicated it would accept a reduced pace of economic growth and before an OPEC gathering later in the week.

Crude for July delivery
US:CLN3
fell 57 cents, or 0.6%, to $93.61 a barrel in electronic trade. Monday’s electronic transactions will be booked with Tuesday’s trades for settlement.

Floor trading on the New York Mercantile Exchange was slated to resume Tuesday, following Monday’s U.S. Memorial Day holiday.

Oil futures in Nymex action on Friday recorded their fourth consecutive loss, falling 2% for the week. Prices are nearly flat so far this month, after falling almost 4% in April.

Chinese President Xi Jinping reportedly said on Friday that his nation, the world’s second-largest oil consumer, would not sacrifice the environment to protect short-term growth.

The Organization of Petroleum Exporting Countries is expected to maintain its supply target at about 30 million barrels a day when it meets Friday in Vienna.

China’s manufacturing activity swung to a contraction in May after months of slowing growth, according to preliminary survey results from HSBC on Thursday. The “flash” version of its Purchasing Managers’ Index for May fell to a seven-month low of 49.6, down from April’s final reading of 50.4. A result below 50 signals contraction.

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Signs of weaker domestic and external demand in China added to concerns among investors about already-high inventories of U.S. crude oil. Last week, the U.S. Energy Information Administration said supply of the commodity fell much less than expected.

Natural gas for June delivery
US:NGM13
added 6 cents, or 1.4%, to $4.297 per million British thermal units.

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